Why Can’t We Build Anything?


topicsfuture

“We’re going to fix them all,” President Joe Biden vowed, awkwardly showing up to give a speech promoting his $1.2 trillion infrastructure bill just hours after Pittsburgh’s Fern Hollow Bridge collapsed in January. “We’re sending the money.”

It is true that the Infrastructure Investment and Jobs Act includes $40 billion in funding to improve the nation’s 43,000 bridges, though that’s a relatively small amount compared to the $156 billion it includes for mass transit and rail (on top of the $70 billion that went to mass transit in pandemic relief), plus the hundreds of billions in additional spending on broadband, green energy, and other stuff that only looks like infrastructure if you squint.

But it’s not true that Washington is actually “sending the money.” Because of Congress’ longstanding inability to perform one of its most basic functions—pass a budget—significant swathes of transportation spending are stalled at 2020 levels. In November, the infrastructure bill did indeed authorize over a trillion in spending. But before all of that money can actually head out the door, there needs to be an appropriations bill in place as well.

Carlos Monje, the undersecretary for policy at the Transportation Department, explained in late January that “the department has begun to move forward on as many aspects of the bill as we can, but some programs are hampered by legislative challenges resulting from the constraints that are in the continuing resolution.”

The infrastructure law theoretically dumped $118 billion into the Highway Trust Fund, which can no longer cover all of its spending from gas tax revenue, for example. But under the current continuing resolution (C.R.)—the stopgap budget measure Congress passes when it can’t get its act together to do a proper annual budget—that money can only be spent at 2020 levels, which means there’s about $9 billion for roads and $3 billion for transit stuck in limbo. That C.R. is set to expire right as this magazine reaches readers, potentially triggering a broad shutdown that would, of course, slow all government functions to a crawl, including infrastructure projects.

It’s also not true that “we’re going to fix them all” even when the money does start flowing. The Fern Hollow Bridge was not on the list of projects to be funded by the new infrastructure bill, even though its condition had been rated “poor” for years. Its absence from the federal list isn’t unreasonable: Pennsylvania drivers already pay the nation’s third-highest gasoline tax, at just over $0.58 per gallon. But a 2019 audit found that $4.2 billion in gas tax revenue that could have been used to repair roads and bridges had been drained off over six years to fund the state police. Meanwhile, a 2017 estimate of the cost to repair the bridge came in at a manageable $1.3 million.

Fern Hollow is a microcosm of a larger problem. The issue has never been a lack of funds for infrastructure; it’s that the money flows unpredictably from multiple sources and then frequently ends up getting spent on something else via a heavily politicized decision-making process.

There’s also the question of why building anything, but especially infrastructure, in the United States costs so much and takes so long. The U.S. is the sixth-most expensive country in the world to build rapid-rail transit infrastructure like the New York City subway or the Washington, D.C., metro system.

Part of the reason is just plain waste and corruption. The federal infrastructure bill has created massive incentives for rent-seeking while ballooning the municipal lobbying sector. Like contestants on a game show, states and localities are scrambling for dollars, correctly understanding that this might be the only major windfall in this area for a decade or more—again, largely due to Congress’ inability to do its job in a predictable way in concert with a chief executive who can set clear achievable policy priorities.

More than 1,000 municipal entities spent just shy of $50 million on federal lobbyists in the second half of 2021 as the infrastructure bill was finalized and passed, according to data tracked by OpenSecrets. That’s about 7 percent higher than the $46.7 million that municipal entities spent in the same period of 2020, which was hardly a dry spell given the federal pandemic spending that was already underway. That number likely underestimates the real demand, since it doesn’t capture contracts signed right at the end of the year.

In theory, no lobbyist is needed to tap into the new infrastructure money. At the end of January, Mitch Landrieu, a former mayor of New Orleans who is overseeing infrastructure spending for the Biden administration, proudly announced the existence of a 465-page guidebook that explains the different pots of money available to communities, along with a data file that is—get this—searchable!

Despite all this, there’s no reason to think the U.S. is notably worse on these measures than other developed nations. Likewise, while some of the cost is inputs, such as material and labor, they don’t explain the disparity fully. A recent study of the interstate highway system from George Washington University professor Leah Brooks and Yale University professor Zachary Liscow suggests that the X-factor is “citizen voice,” which can take the form of legitimate opposition to eminent domain, or which might be less charitably described as “not in my backyard” obstructionism and environmental regulatory foot dragging.

During the interminable negotiations over the bill, Republicans actually tried to untangle some of the green tape with what they called the “One Federal Decision” framework, which streamlines approval for projects reviewed under the National Environmental Policy Act and places a 90-day limit on lead agencies’ final decision making. But there’s always a reason to pull a project out of the fast-track category. A post-passage January memo, for instance, clarifies that any project requiring a new right of way is ineligible for the streamlined review process.

This is hardly a new problem. Eli Dourado, a policy analyst at the Center for Growth and Opportunity at Utah State, told The Week that infrastructure projects funded by then-President Barack Obama’s 2009 stimulus were subject to nearly 200,000 environmental reviews.

And these regulations hamper all projects, not just classic bridge, road, and rail spending. The infrastructure bill actually cleared the way for companies building high-speed vacuum-based hyperloop tunnel projects to become eligible for federal funding, creating a Non-Traditional and Emerging Transportation Technology Council at the Department of Transportation to “support the safe deployment of the transportation system.” While that might sound like an encouraging development for those who are excited about innovations in transportation, anyone who knows how the process really works will find the regulatory jargon above ominous, to say the least.

In this, as in so many other sectors distorted by government spending and regulation, the best hope may lie outside of traditional answers. Perhaps jetpacks will let us skip over the decaying bridges.

Infrastructure is broadly considered one of the least controversial functions of government, just as budgeting is one of the most basic functions of Congress. The messy fate of Biden’s long-awaited bipartisan bill is a reminder that the federal government is so far from getting even these fundamentals right that it certainly shouldn’t be trusted with higher-order functions, and that all of us should be thinking about ways to work around state dysfunction given our limited prospects for improving the current expensive, broken system.

The post Why Can't We Build Anything? appeared first on Reason.com.

from Latest https://ift.tt/W0O2ljk
via IFTTT

Biden Approval Rating Hits Record Low As State Of The Union Looms

Biden Approval Rating Hits Record Low As State Of The Union Looms

37%.

That’s the new headline approval number for President Biden, according to the results of the latest ABC News/Washington Post poll, the first to be released since President Vladimir Putin sent Russian forces storming into Ukrainian territory. The poll dropped over the weekend, just in time for President Biden’s big State of the Union Address tonight.

To be sure, the disaster in Ukraine is only the latest in a series of seemingly never-ending disasters, including surging inflationary pressures, and the US pullout from Afghanistan, have dogged the president during his first year in office. .

His approval rating has been sliding since last summer, as the headline numbers clearly show.

Here’s what that looks like in chart form:

Source: ABC News

But it’s not just Biden who should be worrying about the latest results. There’s reason for all Democrats to be panicking ahead of the midterms.

The poll showed that if the American people had to pick today, they would hand control of Congress to the Republicans.

Source: ABC News

The poll reveals that the main “weakness” behind Biden’s falling approval rating is the doubts about his personal capacities, with 59% of people saying he wasn’t a strong leader compared to just 36% who said he was a strong leader, according to Summit News.

54% of Americans do not think Biden has the “mental sharpness” to serve as president, compared to 40% who say he does.

The public’s confidence in his mental acuity has also fallen drastically over the past year.

“Biden seemed to have lost independents, a critical polling group, on this topic,” reports Breitbart. Some 59% of the independents gave the president’s mental sharpness a negative assessment, a rise of 13 percentage points since May 202

Interestingly, the poll also found that 55% of the public believed Biden had mishandled the Russia situation, with only 36% believing he is doing a good job.

None of that bodes well for the president, as he prepares to lay out his agenda for the coming year, while many rank and file Dems are still mourning the death of ‘Build Back Better’.

Tyler Durden
Tue, 03/01/2022 – 07:00

via ZeroHedge News https://ift.tt/UWGXChB Tyler Durden

Here’s Why Our Monetary System Is A Giant Ponzi Scheme

Here’s Why Our Monetary System Is A Giant Ponzi Scheme

Authored by Chris Macintosh via InternationalMan.com,

Ponzi schemes keep going until the perpetrator is stopped from the outside. They never stop by of their own volition. Bernie Madoff kept going until it all blew up.

In the year 2000 the Nasdaq composite exceeded a P/E of 200 before collapsing 78% by October 2002. The more successful a Ponzi the more egregious the bubble and resultant pain. The granddaddy of Ponzi — far greater than anything we’ve seen before — is our monetary system.

Let’s consider what money is. It is a technology that allows us to produce and consume not just in the present but across time.

It is, for this reason, that it needs to provide both a medium of exchange as well as a store of value. If for example a transaction needs to be made over a crop cycle then the value of the money needs to remain sufficiently stable over that time frame to allow the participants to make an exchange and not come out underwater. This benefits neither party to the transaction because, while in the short term party A may get an excellent deal from party B, if the deal is so “excellent” as to bankrupt party B, then no future commerce will be done and overall production declines causing less supply and a fall in the overall standard of living.

The money needs to be useful to both parties. In prisons they use cigarettes. Even if you don’t smoke enough inmates do and the cigarettes don’t change (consistency) and so they form a money.

Of course, over time we’ve used all sorts of things used as money: gold, silver, copper, even slaves. At primary school I used to use marbles and Garbage Pail Kids (ah, those were the days).

To be used, money needs to be trusted, and to be trusted it needs to have integrity.

But when you involve the government in money inevitably it gets corrupted.

We’ve countless examples, but back in 1215 King John was forced to sign the Magna Carta, which meant that the crown couldn’t tax what the people hadn’t approved. That principle was the foundation of democracy.

Years later King Henry VIII figured out that by clipping the coins he could melt down the clipped portions, melt them into coinage and spend the money. In other words, he inflated the money supply. He was a wily bastard and later figured he could take a copper coin and coat it in silver.

Initially people thought they were getting a pound sterling, but as it turned out — because the old fart had his face emblazoned onto the coin — with his nose sticking out, it was his nose that gave him away. The silver coating specifically on his protruding nose scraped off when it rubbed in peasants’ pockets. This let the copper show through and made his face look like he had a red nose. And so peasants, whenever they looked at the coin with his red nose staring at them, knew immediately that he’s stolen from them.

Trust vanished.

We’re no longer in the 1200’s but that only means the ruling class has gotten better.

This time around, after they’re done with their economic killing spree (aka lockdowns) and rampant monetary inflation, the resulting stagflation will have the same effect amongst the peasants as it did in good ol’ copper nose’s time. Loss of faith.

This Ponzi too will blow up, and the catalyst will be a faltering of trust, because that’s all that’s left holding this together.

It will be individuals that stop it. They’ll stop it by refusing to use the currency.

*  *  *

Disturbing economic, political, and social trends are already in motion and now accelerating at breathtaking speed. Most troubling of all, they cannot be stopped. The risks that lie ahead are too big and dangerous to ignore. That’s why contrarian money manager Chris Macintosh just released the most critical report on these trends, What Happens Next. This free special report explains precisely what’s coming down the pike and what it means for your wealth and well-being. Click here to access it now.

Tyler Durden
Tue, 03/01/2022 – 06:30

via ZeroHedge News https://ift.tt/S0msyZk Tyler Durden

Brickbats: March 2022


brickbats4

Norma Garcia-Lopez resigned as the co-chair of the Racial Equity Committee at Fort Worth Independent School District in Texas after media reported she doxxed several parents who challenged the school system’s COVID-19 mask mandate and who spoke out against critical race theory. Garcia-Lopez posted the names, home addresses, phone numbers, employers, and work emails of those parents. One parent said Garcia-Lopez also left a profanity-laced voicemail.

Katrina Phelan, a teacher at Abraham Lincoln High School in Iowa, has been charged with three felony counts of terroristic threats. Police say Phelan wrote several anonymous notes threatening gun violence at the school. In at least one of the notes she reportedly posed as an unnamed student who had been bullied.

Wishma Rathnayake moved to Japan from Sri Lanka with a dream of teaching English. A little less than three years later, after being arrested for overstaying her visa, she died in a Japanese detention facility for illegal immigrants. An investigation found that staff had denied Rathnayake medical care over a period of several months. A director of a group that helps foreign nationals detained in Japan said he repeatedly urged officials to take her to a hospital but that his requests were denied without explanation.

Samuel Scott Jr. has sued the city of Miami and five police officers for false imprisonment and malicious prosecution. Scott’s problems began when he called to report his car had been stolen. Police spotted the vehicle and gave chase. But the driver crashed into another vehicle and escaped on foot. When cops arrived at Scott’s home, they immediately began treating him as the suspect. They arrested him and charged him with leaving the scene of an accident, false reporting of a crime, failure to carry a concealed weapons license, and possession of marijuana. The district attorney dropped all those charges.

The CIA reportedly had evidence that 10 employees or contractors committed sex crimes against children. The agency fired those employees or canceled their contracts, but only one of them faced criminal charges. BuzzFeed, which broke the story, says the CIA is apparently reluctant to prosecute employees, claiming that doing so could reveal national secrets.

West Creek High School in Clarksville, Tennessee, suspended more than 50 students who took part in a TikTok video showing them raising their cellphones and pointing them like guns. A school spokeswoman said the students violated a section of the school code of conduct barring “any conduct which is disruptive, dangerous, harmful to the student or others, not otherwise specifically enumerated herein.”

Police in Kidderminster, England, have charged Darrell Meekcom with suspicion of indecent exposure and dangerous driving after he mooned a mobile van speed camera. Meekcom, who claims to be terminally ill, says it was a “bucket list” wish because he has been “caught by them a couple of times for silly speeds like 35 mph in a 30 zone and it always bugged me.” Six officers arrived at his home; when he refused to let them in, they kicked his garden gate in, tackled him to the ground, and handcuffed him.

The Pennsylvania Supreme Court has upheld a lower court ruling that the Manheim Township School District violated a student’s rights by expelling him for Snapchat messages he sent in jest after school hours. The student sent a friend two messages making fun of a third student with a penchant for wearing a T-shirt for death metal band Cannibal Corpse. Police investigated and found there was no threat. But school officials decided the messages were threatening anyway.

The post Brickbats: March 2022 appeared first on Reason.com.

from Latest https://ift.tt/jC0dpcY
via IFTTT

Brickbats: March 2022


brickbats4

Norma Garcia-Lopez resigned as the co-chair of the Racial Equity Committee at Fort Worth Independent School District in Texas after media reported she doxxed several parents who challenged the school system’s COVID-19 mask mandate and who spoke out against critical race theory. Garcia-Lopez posted the names, home addresses, phone numbers, employers, and work emails of those parents. One parent said Garcia-Lopez also left a profanity-laced voicemail.

Katrina Phelan, a teacher at Abraham Lincoln High School in Iowa, has been charged with three felony counts of terroristic threats. Police say Phelan wrote several anonymous notes threatening gun violence at the school. In at least one of the notes she reportedly posed as an unnamed student who had been bullied.

Wishma Rathnayake moved to Japan from Sri Lanka with a dream of teaching English. A little less than three years later, after being arrested for overstaying her visa, she died in a Japanese detention facility for illegal immigrants. An investigation found that staff had denied Rathnayake medical care over a period of several months. A director of a group that helps foreign nationals detained in Japan said he repeatedly urged officials to take her to a hospital but that his requests were denied without explanation.

Samuel Scott Jr. has sued the city of Miami and five police officers for false imprisonment and malicious prosecution. Scott’s problems began when he called to report his car had been stolen. Police spotted the vehicle and gave chase. But the driver crashed into another vehicle and escaped on foot. When cops arrived at Scott’s home, they immediately began treating him as the suspect. They arrested him and charged him with leaving the scene of an accident, false reporting of a crime, failure to carry a concealed weapons license, and possession of marijuana. The district attorney dropped all those charges.

The CIA reportedly had evidence that 10 employees or contractors committed sex crimes against children. The agency fired those employees or canceled their contracts, but only one of them faced criminal charges. BuzzFeed, which broke the story, says the CIA is apparently reluctant to prosecute employees, claiming that doing so could reveal national secrets.

West Creek High School in Clarksville, Tennessee, suspended more than 50 students who took part in a TikTok video showing them raising their cellphones and pointing them like guns. A school spokeswoman said the students violated a section of the school code of conduct barring “any conduct which is disruptive, dangerous, harmful to the student or others, not otherwise specifically enumerated herein.”

Police in Kidderminster, England, have charged Darrell Meekcom with suspicion of indecent exposure and dangerous driving after he mooned a mobile van speed camera. Meekcom, who claims to be terminally ill, says it was a “bucket list” wish because he has been “caught by them a couple of times for silly speeds like 35 mph in a 30 zone and it always bugged me.” Six officers arrived at his home; when he refused to let them in, they kicked his garden gate in, tackled him to the ground, and handcuffed him.

The Pennsylvania Supreme Court has upheld a lower court ruling that the Manheim Township School District violated a student’s rights by expelling him for Snapchat messages he sent in jest after school hours. The student sent a friend two messages making fun of a third student with a penchant for wearing a T-shirt for death metal band Cannibal Corpse. Police investigated and found there was no threat. But school officials decided the messages were threatening anyway.

The post Brickbats: March 2022 appeared first on Reason.com.

from Latest https://ift.tt/XuUwEl3
via IFTTT

Elon Musk Suggests SpaceX Will Rescue Space Station If Russia Attempts Sabotage

Elon Musk Suggests SpaceX Will Rescue Space Station If Russia Attempts Sabotage

The head of the Russian space agency warned the International Space Station (ISS) is at risk of deorbiting and crashing if cooperation between the US and Russia in space collapses. Should the US cut off Russia’s access to certain space technologies needed to keep the ISS operational, the result could involve the Russians allowing the station to deorbit and crash. 

No other than the world’s richest man, Elon Musk, responded to a tweet from Roscosmos Director General Dmitry Rogozin that read: 

“If you block cooperation with us, who will save the ISS from an uncontrolled deorbit and fall into the United States or…” 

Musk weighed in by answering Rogozin’s threat with a picture of the SpaceX logo. 

The billionaire replied to multiple Twitter users. One person asked Musk if this indicated SpaceX would keep the ISS from plummeting to Earth. Musk replied: “Yes.”

Musk also responded to an editor of NASASpaceflight.com who posted a thread with a picture of what the ISS would look like without the Russian Segment attached and a SpaceX Dragon docked on the station to provide re-boost capability and attitude control. Musk said it was a “good thread.”

Last Thursday, President Joe Biden laid out new sanctions that he said would “degrade” Russia’s “aerospace industry, including their space program,” among other things.

The ISS is a collaboration between the US, Russia, Japan, Canada, and the European Space Agency. Presently, two Russian cosmonauts, four NASA astronauts, and one European astronaut live and work onboard the ISS.

Russia has already said it will pull out of the ISS by 2025. Roscosmos has already begun work on a new space station. 

Tyler Durden
Tue, 03/01/2022 – 05:45

via ZeroHedge News https://ift.tt/dkIAtOf Tyler Durden

Is Hydrogen A Better Bridge Fuel Than Natural Gas?

Is Hydrogen A Better Bridge Fuel Than Natural Gas?

Authored by Irina Slav via OilPrice.com,

  • Natural gas has long been touted as a key “bridge fuel” in the world’s path to net-zero.

  • The crisis in Ukraine is now highlighting some of the major problems with Europe’s dependence on natural gas.

  • Hydrogen is quickly emerging as a potential alternative to natural gas, and Europe is all for it.

With the latest events unfolding in Ukraine, the topic of natural gas dependence and its implications has once again taken center stage. Natural gas is the least polluting fossil fuel, which has made it a preferred “bridge” to net zero. The dependence element, however, has cast a shadow over the future of gas, and alternatives are being actively—if not desperately—sought. One of the most talked-about among these alternatives is hydrogen—an energy carrier rather than a fuel—but an element so versatile it can be used for some of the things gas is now used for, including fuel for transport and heating.

In fact, according to a Goldman Sachs analyst, hydrogen could turn into a $1-trillion market in the future.

“If we want to go to net-zero we can’t do it just through renewable power,” Michele DellaVigna told CNBC earlier this week.

“We need something that takes today’s role of natural gas, especially to manage seasonality and intermittency, and that is hydrogen.”

“And once we have it, I think we have a solution that could become, one day, at least 15% of the global energy markets which means it will be … over a trillion-dollar market per annum,” DellaVigna also said.

“That’s why I think we need to focus on hydrogen as the successor of natural gas in a net-zero world.”

As with most things, however, this is easier said than done. Green hydrogen has been attracting growing attention as it is considered the cleanest form of hydrogen production but green hydrogen has problems such as the fact that electricity for it comes from intermittent solar and wind, and that a lot of the energy used to produce hydrogen through electrolysis is lost, which means the efficiency of the process is limited, which in turn makes it more expensive.

As for blue hydrogen that includes carbon capture and storage, environmentalists have slammed it for being, effectively, greenwashing on the part of energy companies as carbon capture and storage technology has no real future, being ineffective and expensive. On top of that, most of the captured carbon dioxide is used for enhanced oil production, which also does not sit well with environmentalists.

That said, hydrogen is, as Goldman’s DellaVigna called it, “a very powerful molecule”. Hydrogen is used in the treatment of metals; it is used in the production of fertilizers; and, of course, it can be used as fuel in fuel-cell cars. Hydrogen is also being blended already in the UK with natural gas and used for heating purposes.

Forecasts for the future of hydrogen and, more specifically, green hydrogen, the ultimate net-zero fuel, have been quite upbeat in the past couple of years. The main reason for this was falling costs associated with wind and solar energy as the technology continued to improve while raw material costs remained low.

Unfortunately for the upbeat forecasters, this is changing. The wind and solar industries are facing rising rather than falling costs as raw materials soar on the back of expectations for stronger demand and tight supply.

The Wall Street Journal reported earlier this month that wind turbine manufacturers are struggling with turning a profit because of costlier raw materials, logistical challenges, and uncertainty around subsidies, the last one in the United States. The report quoted a projection by Wood Mackenzie that anticipates a 10-percent increase in wind turbine prices over the next 12-18 months due to higher prices of steel, aluminum, copper, and carbon fiber.

Even so, companies are building electrolyzers in anticipation of more government support for hydrogen. Last year, for example, Shell built an electrolyzer in Germany to produce 1,300 tons of the element annually. The company admitted green hydrogen costs five times as much as fossil fuel-derived hydrogen but noted scale and efficiency improvements can bring costs down, as can additional government support.

France’s Engie and Emirati Masdar last year closed a $5-billion partnership to develop green hydrogen in the UAE. Per their plans, the two will develop projects with a total capacity of 2 GW by 2030, Engie said in December.

Then in January this year, Shell again announced the launch of a hydrogen project in China. The electrolyzer is one of the largest in the world and will take advantage of the abundant wind power capacity in the Hebei province of China.

The EU has plans to build electrolyzers with a total capacity of some 40 GW by 2030. Of this total, the EU wants to have 6 GW up and running within two years.

It seems obvious that the materialization of these plans would depend strongly on government incentives. Without them, the high costs of green hydrogen production would derail all the ambitious plans. The question, then, remains whether governments that are currently struggling with inflation rates not seen in decades, among other lingering effects of the pandemic, will have enough money to incentivize everything about the green transition they want to incentivize, including green hydrogen.

Tyler Durden
Tue, 03/01/2022 – 05:00

via ZeroHedge News https://ift.tt/nGhEZR8 Tyler Durden

Brickbat: School Disciplinarian


computersnoop_1161x653

In Michigan, Rochester Community Schools Superintendent Robert Shaner admitted the school system monitored the social media of parents who protested school officials’ decision to keep schools closed. Shaner also admitted contacting the employers of some of those parents and calling the police on one parent who called for protests outside private homes, saying he regarded that as a threat. Shaner’s admissions came in a deposition in a lawsuit brought by parents. One of those parents, Elena Dinverno, said she was fired after school officials falsely told her employer she was part of a group threatening the school system.

The post Brickbat: School Disciplinarian appeared first on Reason.com.

from Latest https://ift.tt/PtWQlkc
via IFTTT

Europe’s Depleted Gas Storage Might Not Get Refilled Ahead Of Next Winter

Europe’s Depleted Gas Storage Might Not Get Refilled Ahead Of Next Winter

Europe may have trouble replenishing its natural gas storage facilities by next winter as storage levels are at decade lows. 

Russia, which supplies one-third of Europe’s natgas needs, has said delivery of gas through vast networks of pipelines will continue.

On Monday, Russia’s gas producer Gazprom published a statement warning there will be “serious challenges” in replenishing European gas storage facilities for next winter considering “such significant gas volumes” are needed and never has this happened ahead of the summer months. 

Gazprom said there could be daily restrictions on injections because of the technological capacities of the pipeline infrastructure. Then there’s also the risk of damage to pipelines that transit gas from Russia through Ukraine. On top of this, European markets will be competing with increasing demand from Asian markets. 

Bloomberg data shows that German underground storages “are depleted” by 70.6%, while French ones are 77.1%. Gas withdrawal from European storage lasts until late March and, in some cases, early April. Gas injections begin shortly after to resupply the continent for the summer months and ahead of next winter. However, since storage levels are at decade-low levels, filling up ahead of next winter could be a challenge. 

Then there’s the risk of Russia limiting natgas flows to Europe in retaliation for a raft of fresh sanctions that froze Russian central bank assets, and some Russian banks were removed from the SWIFT financial messaging system, which has caused utter chaos in Russian markets on Monday, especially in FX markets

Wood Mackenzie analyst Kateryna Filippenko told Reuters, “Europe might have to pull every lever to keep the lights on – reducing gas burn and cranking up mothballed nuclear and coal plants; maximizing indigenous gas production and pipeline imports.” 

Filippenko said there would be temporary fixes, leaving Europe with “perilously low storage volumes” going into winter, adding that energy prices “could be higher than 2021/22”.

Kaushal Ramesh, an analyst at Rystad Energy, also agreed with Filippenko: “End-2022 and going into 2023 may see prices closer to the 2021 winter and could be higher.” 

Although the European benchmark, Dutch gas prices, are below December’s record highs, prices did jump 60% on Thursday after Moscow invaded Ukraine

Higher energy prices have rippled through the economy and resulted in a massive surge of power prices that have crushed households across Europe. Governments in the region are spending billions of euros shielding consumers from soaring power prices. 

“Rising commodities prices will further fuel already high levels of inflation, putting Western central banks between a rock and a hard place,” said Teeuwe Mevissen, senior market economist at Rabobank.

“Raising interest rates will increase the chance of hurting the pace of economic recovery, not raising rates might lead to increased inflation expectations and might still lead to a deflationary environment because of lower purchase power putting pressure on spending power and, therefore, demand,” said Mevissen. 

The good news so far is that “western nations have excluded Russian commodity exports from sanctions,” said Mark Haefele, chief investment officer for global wealth management at UBS Group AG.

“But positions are shifting fast, and Western nations have already begun implementing measures that seemed unlikely a few days ago, and the White House has stated that energy sanctions are on the table,” Haefele said. 

Even though Gazprom continues to pump gas into the energy crisis-stricken continent, there are genuine risks that supply disruptions could be seen or at least pipeline capacity into Europe might not be able to inject enough gas to refill supplies ahead of next winter, which could very well result in higher energy prices. 

Tyler Durden
Tue, 03/01/2022 – 04:15

via ZeroHedge News https://ift.tt/dkwhz7m Tyler Durden

Brickbat: School Disciplinarian


computersnoop_1161x653

In Michigan, Rochester Community Schools Superintendent Robert Shaner admitted the school system monitored the social media of parents who protested school officials’ decision to keep schools closed. Shaner also admitted contacting the employers of some of those parents and calling the police on one parent who called for protests outside private homes, saying he regarded that as a threat. Shaner’s admissions came in a deposition in a lawsuit brought by parents. One of those parents, Elena Dinverno, said she was fired after school officials falsely told her employer she was part of a group threatening the school system.

The post Brickbat: School Disciplinarian appeared first on Reason.com.

from Latest https://ift.tt/PtWQlkc
via IFTTT